Average farmland values in England and Wales fell slightly in the second quarter of this year, reflecting increased caution in parts of the market.

Data from the latest Carter Jonas Farmland Market Update, released today, shows average arable land values fell by 1.1% compared to the first three months of this year, while average pasture land declined at a more modest rate of 0.7%. 

The national property consultancy says the drop is due to a number of factors, and that the values being achieved can vary enormously from postcode to postcode.

Sellers are being advised to ensure land and property are properly valued, realistically priced, and brought to the market issue-free to avoid deterring a smaller pool of purchasers. 

Similarly, buyers should remain well informed and keep abreast of opportunities to transact. 

Arable land traded at an average of £9,700/acre with grassland at £7,900/acre during April, May, and June 2025. Whilst values have decreased from those in the first quarter, year-on-year land values are 0.3% and 0.9% higher.

Andrew Chandler, Carter Jonas Head of Rural Agency, said the data suggested an easing in buyer appetite for some assets.

"There remains healthy levels of demand for prime assets with prices often being achieved ahead of expectations, particularly when there is interest from local farmers and investors looking to expand their operations and in locations with a strong rollover buyer presence," he said.

"Other assets are being approached with hesitancy. As a result, the gap between prime and secondary or tertiary land has widened further.

"Some business pressures are undermining confidence and resulting in a thinner buyer pool, and this, coupled with increased supply in some areas, has led to downward pressure on pricing for land where returns are less certain."

The volume of new, publicly marketed supply picked up pace in the second quarter of 2025 and, with a healthy and steady pipeline predicted for the coming months, experts expect any further price adjustments to be moderate rather than dramatic.

"Rather than one main factor driving the increase in supply, a combination of mounting pressures is prompting some farmers and landowners to review their business strategies and financial position, sometimes leading to a decision to sell," says Sophie Davidson, Research Associate at Carter Jonas.

"Volatile commodity markets, increased employment costs, the effects of climate change, impending inheritance tax changes and ongoing adjustments to the policy landscape are other factors that could have an impact.

"These same pressures are also causing increased hesitancy amongst buyers, who have become more selective and sensitive to pricing."

In a softening market, Carter Jonas advises both buyers and sellers to proceed with care and clarity. "Sellers should focus on realistic pricing from the outset. Over-pricing in the current environment is likely to disadvantage an asset, reducing interest and potentially leading to longer sale times or price reductions later on," says Mr Chandler.

"Preparation is also key. Ensuring that any potential issues, such as unresolved rights of way, access arrangements, restrictive covenants, or missing easement agreements, are addressed before launch can help avoid complications that might deter cautious buyers or delay the transaction."

Buyers, meanwhile, are urged to remain diligent and well-informed. "Where land offers strong long-term potential, there are still opportunities – but careful due diligence and a clear understanding of current risks are essential," Mr Chandler said.

Read the full Farmland Market Update here.